Bone is one of the most implanted materials in the body, second only to blood. The market for bone grafting and dental implants is currently over $4.8 billion and is expected to grow rapidly in the future. Autograft has traditionally been used, but limited supply, donor-site risks, and cost created a demand for bone graft substitutes. As an osteoinductive bone graft material, demineralized bone matrix (DBM) has emerged as an effective alternative to autograft. But without a carrier, DBM is difficult to handle and its particles may be dispersed by blood from the bone defect, which weakens its clinical effectiveness. A malleable, hemostatic, and rapidly resorbable carrier may significantly improve DBM's handling and clinical effectiveness. Alkylene oxide copolymer (Ostene) invented by USC researchers has all these characteristics. It was recently cleared by the FDA as a synthetic alternative to bone wax;it sticks well to wet surfaces and stops bone bleeding by mechanical occlusion. Ostene is a combination of biocompatible water-soluble polymers which dissolves completely within 2-3 days of implantation. It is non-aqueous and non-inflammatory;it does not increase the risk of infection or inhibit osteogenesis. This combination of properties makes Ostene an ideal carrier for delivery of DBM to any bone defect. The objective of this project is to develop a novel DBM-Ostene bone graft that is both osteoinductive and hemostatic, osteoconductive and easy to handle. The polymer's non-aqueous composition would act as a natural preservative for DBM, activating it only after implantation. The carrier would prevent blood flow from the bone defect and create a more concentrated DBM scaffold for osteoinductivity and better bone fusion;rapid resorption would allow quick activation of DBM and earlier onset of healing without adding risk. This application describes the research leading to new compound's pre-clinical formulation, in vitro validation, stability, osteoinductivity testing, and kinetics of release study, as well as in vivo functional evaluation and biocompatibility studies. The research will be followed by higher order animal studies in phase II to test the optimal composite for specific functional applications, such as spinal fusion and sternal bone repair. Successful development of the final DBM product will shorten the current bone graft procedure, improve the bone graft's handling, promote stronger bone fusion, and enable earlier healing and post-operative recovery without adding risk. PUBLIC HEALTH RELEVANCE: Bone tissue, used to fill defects caused by trauma, tumor resection, reconstruction, and repair of congenital or age-related problems, is one of the most implanted materials in the body, second only to blood. Autograft - patient's own bone -- has been the bone graft of choice, but its limited supply and multiple procedures required for harvesting and implantation combined with risk and high cost created a growing demand for functional bone graft substitutes;several alternatives have become available, but the materials have problems ranging from insufficient osteinductivity and difficult handling to lack of bone hemostasis and side effects. We propose to combine Demineralized Bone Matrix (DBM) - a human bone-derived allograft most closely resembling the patient's own tissue - with a newly available inert, malleable, and rapidly resorbable bone hemostasis material as a carrier to create an easy to handle, highly osteoinductive, and versatile bone graft substitute with added hemostatic function which will help shorten the current orthopedic procedure, strengthen bone fusion, and promote significantly earlier onset of healing and postoperative recovery without increased risk.